Professor Godfred Bokpin, an expert in Economics and Finance at the University of Ghana Business School, has underscored the significant financial impact of illegal mining, commonly known as galamsey, on the country.
He revealed that Ghana suffers an annual loss exceeding $2.4 billion due to these illicit mining activities.
Professor Bokpin cautioned that without immediate intervention to tackle galamsey, Ghana could face a severe national crisis, stemming from the government’s failure to recapture the revenues lost to these unlawful operations.
“I’m looking at irresponsible mining from different angles, so we are not benefiting optimally. The revenue losses, in total, amount to over $2.4 billion annually. That is the fiscal loss to the state. In fact, that’s far more than what we are getting from the IMF.
“So, the fiscal losses are huge. In other words, we are not getting the revenue from there, even if we want to deploy it to mitigate the side effects. When we talk about illegal mining, smuggling, and the associated losses, we are losing massively”.
Professor Godfred Bokpin
Professor Bokpin expressed his concerns that Ghana is not fully reaping the benefits of the abundant natural resources bestowed upon the nation.
He warned that the country may struggle to manage the environmental and health repercussions of illegal mining, as the failure to recover lost revenues will impede necessary corrective actions.
He emphasized that Ghana’s economic development and recovery are at risk if the degradation of the environment persists.
Prof. Bokpin further contended that those who assert that a ban on galamsey would lead to job and revenue losses are misguided.
He indicated that while mining does contribute to Ghana’s GDP, its overall impact on the economy has been limited.
The Economist asserted that in reality, the sector has not significantly increased employment opportunities, alleviated poverty, or narrowed the gaps in social inequality.
Accordingly, he stated that the reliance on illegal mining often perpetuates these issues, as it undermines sustainable economic growth and can lead to adverse social consequences.
Impact of Mining on GDP and Employment Highlighted
Furthermore, Professor Godfred Bokpin explained that between 2011 and 2022, nearly 20% of Ghana’s GDP growth was attributed to the mining and quarrying sectors.
However, Prof. Bokpin pointed out that this growth has not translated into positive job creation, nor has it effectively contributed to poverty reduction or diminished social inequality.
He also noted that although there are responsible methods for conducting mining, numerous irresponsible miners have exacerbated environmental degradation.
“There is a responsible way to do mining. However, the path we have chosen, particularly with artisanal and illegal mining, is not sustainable. Let me digress—do you know that ten years ago, preliminary data showed many small businesses engaged in illegal mining? Many now have permits, but even with permits, some are still engaging in irresponsible mining.
“There can never be an economy without the environment. Development, recovery, and economic sustainability are impossible without ecosystem sustainability. This does not happen in any serious country”.
Professor Godfred Bokpin
Bokpin warned that if galamsey is not curtailed soon, it could lead to severe consequences for Ghana’s economy, potentially undermining the country’s financial stability and growth.
He emphasized that such a crisis would not arise from a lack of data or information, but rather from poor decision-making and failure to implement effective policies by the nation.
Prof. Bokpin indicated that if the country faces dire consequences, it will be a result of the choices made by its citizens. “It would be due to a choice, a decision made by a country of 37 million people.”
He highlighted the essential link between environmental health and economic prosperity, emphasizing that a thriving economy depends on the sustainability of natural resources and the preservation of ecosystems.
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